Major International Business Headlines Brief::: 10 December 2018

Mon Dec 10 08:12:48 CAT 2018

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Major International Business Headlines Brief::: 10 December 2018

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*  Cocoa companies fail on pledge to stop Africa deforestation - report

*  Protesters force shutdown at Libyan El Sharara oilfield - sources

*  Air fares in Sudan soar due to local currency's devaluation

*  Nigeria's cabinet agrees to send 2019 budget to parliament

*  South Africa's Absa bank aims to lift lagging return on equity by 2021

*  Mozambique loan holders will not get future gas revenues in debt overhaul -legal counsel

*  Fastjet has only enough cash to operate for a week

*  Nearly half of Tanzania's banks vulnerable to financial shocks - IMF

*  Kenyan finance minister welcomes NIC Bank, CBA merger talks

*  Ivory Coast withdraws licences of two defaulting cocoa exporters -sources

*  Yellow vest protests 'economic catastrophe' for France

*  Interserve: Major government contractor seeks second rescue deal

*  O2 'to seek millions' in damages over data outage

*  Huawei arrest: China demands Canada free Meng Wanzhou

*  Wall Street ends lower after a down week

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Cocoa companies fail on pledge to stop Africa deforestation - report

DAKAR (Thomson Reuters Foundation) - Major chocolate companies have failed to keep a promise they made a year ago to stop forests in West Africa being destroyed for cocoa production, a campaign group said on Friday.

Companies from Mars to Hershey to Barry Callebaut joined the governments of Ivory Coast and Ghana to launch the Cocoa and Forests Initiative last year, pledging to eliminate the production and sourcing of cocoa from protected forests.

But satellite images of Ivory Coast’s southwest cocoa-growing region showed about the same amount of forest had been lost in the 12 months since the pledge was made as in the previous year, campaign group Mighty Earth said in a report.

“I would have expected to see some deforestation continue, because it’s very hard to transform an entire industry overnight, but I did not expect to see it continue exactly the same as before,” said the report’s author, Etelle Higgonet.

If deforestation continues unabated, Ivory Coast - the world’s top cocoa producer - risks losing all its forest cover by 2034, environmental campaigners say.

But stopping it is a challenge since the cocoa grown on that land provides livelihoods for hundreds of thousands of farmers and their families.

Land is scarce, so poor farmers often expand into forests or parks to raise their incomes, experts say.

Mighty Earth recorded 13,748 hectares of deforestation - equivalent to 15,000 football fields - in Ivory Coast’s southwest region between Nov. 2017 and Sept. 2018.

This put it on track to reach about the same figure as last year - 14,827 ha - by November, Higgonet said.

The group was not able to obtain data as precise from Ghana, but observed a similar lack of change there, she added.

The World Cocoa Foundation (WCF), the industry group behind the Cocoa and Forests Initiative, said recent reports show there has been progress in national parks and classified forests.

“Our immediate priority has been to stop deforestation in the most ecologically important and environmentally sensitive areas, and we are encouraged to see positive results in less than one year,” said WCF president Richard Scobey.

Most of the recent deforestation hotspots are in rural areas outside protected forests, which is legal but still environmentally damaging, he told the Thomson Reuters Foundation.

Mighty Earth also accused companies of not upholding their pledge to stop buying cocoa from national parks.

Ivory Coast has estimated 40 percent of its cocoa comes from protected areas.

“I feel like people are taking me for a fool. Because if you do the math ... somebody’s buying it,” said Higgonet.

“South Africa’s ratings are weighed down by low growth potential, sizeable government debt and contingent liabilities,” Fitch said in a statement. It rates both Pretoria’s foreign and local currency debt at ‘BB+’, one notch below investment grade.

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Protesters force shutdown at Libyan El Sharara oilfield - sources

LONDON/BENGHAZI, Libya (Reuters) - Tribesmen staging a protest at Libya’s 315,000 barrels-a-day El Sharara oilfield are forcing workers to shut down production, two Libyan oil officials and a spokesman for the protesters said on Sunday.

There was no immediate comment from Libyan state petroleum company National Oil Corp (NOC).

The company accused security guards on Saturday of having facilitated a protest by tribesmen, describing it as an “occupation” of the field located in Libya’s southern Fezzan region.

The tribesmen call themselves the Fezzan Anger Movement and are demanding more development projects for their community.

Their spokesman Mohamed Maighal said they would allow crude oil already extracted to be put into storage tanks but force production to be stopped.

The field has been repeatedly threatened by tribesmen asking for better health and other state services for poor, desert region. NOC has previously tried to avert such action through talks.

Air fares in Sudan soar due to local currency's devaluation

KHARTOUM (Reuters) - Air fares in Sudan skyrocketed this week after aviation authorities ordered airlines to price tickets in line with a new exchange rate mechanism that sharply devalued the local currency.

Under the exchange regime introduced in October in a bid to tackle an acute shortage of foreign currency, the Sudanese pound was devalued to 47.5 per U.S. dollar from 29 pounds per U.S. dollar previously.

That has led to a surge in the cost of many goods and services, but air ticket prices had been set according to the customs exchange rate — 18 pounds per dollar — until Wednesday when the country’s Civil Aviation Authority announced the hike in a memo sent to airlines.

The order caused prices to jump about 66 percent, according to travel agencies’ estimates. Prices in dollars were not affected, but only foreigners and Sudanese residents of other countries may buy tickets in dollars.

“This decision has led to a drastic 60 percent drop in travel in the last two days. This situation puts the aviation industry in Sudan and travel agencies at risk of unbearable losses,” said Mahjoub Almack, head of the Sudanese Association of Travel and Tourism Agents.

Despite October’s devaluation, the pound remains under pressure and the gap between the official and black market rates has continued to widen. A dollar cost 57 pounds on the black market on Saturday.

Nigeria's cabinet agrees to send 2019 budget to parliament

ABUJA (Reuters) - Nigeria’s cabinet has agreed to send the 2019 budget to parliament, the budget minister, Udoma Udo Udoma, said on Friday.

Udoma, speaking to reporters in Abuja, said the president would present the budget to parliament “as soon as possible”, but declined to give further details.

South Africa's Absa bank aims to lift lagging return on equity by 2021

JOHANNESBURG (Reuters) - South African lender Absa Group set out new targets to raise its return on equity (RoE) by around 4 percent by 2021, from levels currently among the lowest of South Africa’s big four banks.

In a statement, the bank said on Friday it hoped to grow its RoE to between 18 percent and 20 percent by 2021, from 16.4 percent in 2017 - above the 15.3 percent reported by peer Nedbank.

But that compares to the 23 percent achieved by South Africa’s biggest lender by market value, FirstRand in the year to June 2018, and 17.1 percent at rival Standard Bank.

Absa, currently South Africa’s third biggest lender, is trying to carve out a name for itself as a stand-alone African bank after separating from its parent, Britain’s Barclays, in 2017.

Earlier this year, it laid out a new strategy including a plan to double its market share across the continent to 12 percent, starting by entering the Nigerian market.

Also on Friday, the bank said it thinks it can grow revenues faster on average than the South African banking sector as a whole between 2019 and 2021, and that it can achieve this “within appropriate risk parameters”.

This, along with an ongoing effort to trim costs, mean it also hopes to see its normalised cost-income ratio fall to the low 50s by 2021. This increased between 2016 and 2017, from 55.2 percent to 56.8 percent.

The bank said the targets are based on its current expectations for growth in South Africa and other countries on the continent where it has a presence, and did not account for any major unforeseen economic or regulatory changes.

Absa also reaffirmed its guidance for its full-year results in 2018, including that its normalised return on equity would increase slightly from current levels.

Mozambique loan holders will not get future gas revenues in debt overhaul -legal counsel

LONDON (Reuters) - Holders of Mozambique’s state-guaranteed loans ear-marked for restructuring will not receive any instruments allowing them a share in future revenues from offshore gas projects, unlike Eurobond creditors, the country’s legal counsel said.

Mozambique’s government is battling to overhaul its suffocating debt burden after admitting in 2016 to $1.4 billion of previously undisclosed loans, which prompted the International Monetary Fund and foreign donors to cut off support, triggering a currency collapse and a debt default.

Maputo needs to restructure a $535 million state-backed loan to Mozambique Asset Management (MAM) arranged by Russian lender VTB and a similar $622 million facility for maritime security projects at ProIndicus arranged by Credit Suisse. Also due for overhaul is a $726.5 million Eurobond.

“My expectation is that there will be similarities between the deals that the guaranteed lenders get - whether it is ProIndicus or MAM,” Ian Clark, partner at White & Case, told Reuters.

However, the deal envisaged with holders of the guaranteed loans would differ from the one offered to Eurobond holders, he said. Mozambique announced in November it had reached a deal with the bulk of Eurobond creditors which included extending maturities and sharing future revenues from huge offshore gas projects.

“It may be that the lenders will get loans for example, rather than bonds. Whether the lenders will get value recovery instruments (VRI) will be doubtful,” he said, adding that Finance Minister Adriano Maleiane had ruled out VRIs for loan holders.

Mozambique’s Rovuma Basin boasts natural gas resources of 180 trillion cubic feet, enough to underpin huge liquefied gas export plants under development by global energy firms such as Exxon Mobil, Anadarko and Eni.

Speaking about progress in the restructuring of the Eurobond, Clark also said he had not heard back from Franklin Templeton - one of the major holders.

Farallon Capital Europe LLP, Greylock Capital Management, LLC, Mangart Capital Advisors SA and Pharo Management LLC, which make up 60 percent of bondholders, have backed the agreement in principle, according to Maputo.

Apart from those four firms, the steering committee of the Global Group of Mozambique Bondholders (GGMB) which headed the talks also included asset manager Franklin Templeton Investment Management Limited.

“They (Franklin Templeton) have not supported it so far – maybe they will change their mind, we are not writing them off,” said Clark.

“But there is 40 percent of investors out there who still have to decide. It is our job to convince 15 percent of them. So we are optimistic but we are not complacent.”

Fastjet has only enough cash to operate for a week

(Reuters) - Low-cost African carrier Fastjet Plc said it was capable of operating for another seven days, after the troubled airline planned for additional funds and equity refinancing in November to raise its equity capital by at least $40 million.

Fastjet said discussions with stakeholders so far had been positive, but there is no guarantee of a successful outcome.

Nearly half of Tanzania's banks vulnerable to financial shocks - IMF

DAR ES SALAAM (Reuters) - Nearly half of Tanzania’s 45 banks are vulnerable to adverse shocks and risk insolvency in the event of a global financial crisis, the International Monetary Fund (IMF) said on Friday.

    The IMF urged the East African country to improve asset quality, address non-performing loans (NPLs) and increase capital buffers in the banking system.

“Solvency stress tests reveal that 22 banks, representing 32 percent of banking assets, would become undercapitalised in the tail risk scenario,” the IMF said in its latest financial system stability assessment of Tanzania.

The IMF carries out the stress tests every after five years.

    The scenario envisaged a rare but possible combination of external and domestic shocks, IMF said.

“These assumed shocks trigger a sharp slowdown in domestic growth, a currency depreciation, spikes in domestic inflation and interest rates and a credit squeeze.”

Tanzania has been trying to tighten controls on the banking industry as well as push ahead with reforms to bolster the economy, which grew 7.1 percent last year and is expected to maintain the same pace of growth in 2018, supported by agriculture, mining, construction, communication and financial services.

Last month, Tanzania’s central bank suspended five banks from trading in the interbank foreign exchange market for one month for breaching regulatory rules.

    The suspension came days after the central bank conducted surprise inspections of foreign exchange bureaus in the northern town of Arusha, a tourist and gemstone trading hub, in a crackdown on illegal forex trading and money laundering activities. [L8N1XV3WY]

    In January, the central bank had revoked the licences of five “critically undercapitalised.” community banks in January to protect financial stability.

    The IMF’s latest stress tests revealed that six banks in Tanzania were currently undercapitalised, while 37 out of 45 banks showed varying degrees of under-provisioning by the end of last year.

    The IMF advised the government to enhance surveillance and monitoring of liquidity risks in the foreign exchange market and undertake measures to mitigate them.

    The IMF also said bad loans posed a risk to the country’s financial system, with bank asset quality deteriorating in recent years, hence increasing the need to raise provisions.

    Non-performing loans ratio industry-wide increased from 6.8 percent in 2014 to 11.5 percent in 2017 while at end-2017, 24 banks had NPLs ratios exceeding 10 percent, the IMF said.

Kenyan finance minister welcomes NIC Bank, CBA merger talks

NAIROBI (Reuters) - Merger talks between NIC Bank and Commercial Bank of Africa were welcome, because a deal would help strengthen the financial sector, Kenya’s finance minister said on Friday.

The two Kenyan banks announced on Thursday that they would hold talks on a potential merger, which would be the first major deal since the government capped commercial lending rates in 2016. [nL8N1YB4PP]

“Consolidation of the financial sector is something of importance,” Henry Rotich said. “Treasury has been supportive of a sector that is well served by stronger banks.

“So as you see more banks consolidating on voluntary basis, that is a welcome move, so that we can ensure that the banks are strong enough to provide sufficient credit to SMEs.”

Agreements among lenders would also help to spread their wings around the region, Rotich said, and consolidation was likely to continue.

Ivory Coast withdraws licences of two defaulting cocoa exporters -sources

ABIDJAN (Reuters) - Ivory Coast has revoked the licences of two cocoa exporters which relinquished their contracts after they were denied bank financing, two sources at the country’s cocoa marketing board CCC said on Friday.

Earlier this year, the world’s biggest cocoa producer toughened up conditions for awarding export licences to avoid a repeat of defaults linked to a disastrous 2016/17 season, when world market prices fell 40 percent.

Cocoa exporters Green & Brown and Tropicao have returned their licences to the CCC as they were heading for default due to a lack of financing, one CCC source said.

A second source told Reuters their contracts would be sold off as fast as possible.

Company officials declined to comment. The volume of contracts they currently hold is unknown.

The CCC plans to resell another 150,000 tonnes of cocoa export contracts on the verge of default in January 2019, the sources told Reuters.

Several other small exporters told Reuters they have been struggling to obtain funding from Ivorian banks, which lost money after top exporter SAF-Cacao - one of several exporters with outstanding bank loans - was liquidated over debts owed to the CCC in July last year.

“Many small exporters are almost in default, so we are considering reselling their contracts,” one CCC source said.

Ivory Coast sells forward most of its expected cocoa harvest to set a minimum price for farmers for the October-September season.

The country’s regulator sold around 1.75 million tonnes of export contracts before the start of the 2018/19 season, allowing a guaranteed price of 750 CFA francs ($1.30) per kg of cocoa.

($1 = 575.4500 CFA francs)

Yellow vest protests 'economic catastrophe' for France

The "yellow vest" protests have been "a catastrophe" for the French economy, the finance minister says.

France has seen four consecutive weekends of demonstrations against fuel tax rises, high living costs and other issues.

About 125,000 protesters took to the streets on Saturday, with more than 1,200 taken into custody.

President Emmanuel Macron is expected to announce anti-crisis measures in an address to the nation on Monday.

Finance Minister Bruno Le Maire called the situation "a crisis" for both society and democracy.

"It's a catastrophe for business, it's a catastrophe for our economy," he said during a visit to shops in Paris that had been damaged during the protests.

The capital was particularly badly hit, with windows smashed, cars burned, and shops looted, as 10,000 people took part in demonstrations.

In pictures: France's latest protests

Why the 'yellow vests' won't stop protests

French students 'humiliated by police'

"There was much more damage yesterday than a week ago" because Saturday's protests were more dispersed, deputy mayor Emmanuel Gregoire told local radio.

However, he added that there had been fewer injuries compared with last week.

Meanwhile Foreign Minister Jean-Yves Le Drian responded angrily to US President Donald Trump, who on Saturday in tweets appeared to suggest the Paris Climate Agreement was the reason for the unrest.

"I say this to Donald Trump and the French president says it too: leave our nation be," Mr Le Drian said.

President Emmanuel Macron - who many protesters want to stand down - will address the nation at 20:00 local time (19:00 GMT) on Monday.

He is expected to meet trade union and business leaders in the morning, according to union sources.

Mr Macron has kept a low profile so far during the protests.

How bad is the economic damage?

It is too early to calculate the full economic cost - but it's clear the damage is severe.

Le Parisien newspaper reported that in the capital about 50 vehicles had been burnt and dozens of businesses vandalised, with some of them looted. The authorities in the city say that riots have caused millions of pounds of damage.

On Friday, the French retail federation told Reuters news agency that retailers had lost about €1bn ($1.1bn; £900m) since the protests first began on 17 November.

Mr Le Maire said last week, before the most recent protests, that the restaurant trade had declined by between 20% and 50%.

And Francois Asselin, head of the confederation of small and medium-sized businesses, told the Journal du Dimanche newspaper (in French) that overall the protests could cost his members €10bn.

There are concerns that the protests could lead to a drop in tourism. Paris was visited by a record number of tourists in 2017 - more than 40 million, the Paris Tourism Office said last month.

What is the yellow vest movement?

The movement began as a protest against a rise in duties on diesel, which is widely used by French motorists and has long been less heavily taxed than other types of fuel.

Diesel prices have risen by about 23% over the past 12 months - and Mr Macron's decision to impose a tax increase of 6.5 cents on diesel and 2.9 cents on petrol from 1 January enraged protesters.

Mr Macron had blamed world oil prices for three-quarters of the price rise, but said higher taxes on fossil fuels were needed to fund renewable energy investments.

Who are the 'gilets jaunes'?

Will the environment be the true victim of France's riots?

Who supports the protesters?

The rallies became known as the "yellow vest" or "gilets jaunes" movement because protesters took to the streets wearing the high-visibility yellow jackets that are required to be carried in every vehicle by French law.

The government has since agreed to scrap the fuel tax increase and has frozen electricity and gas prices for 2019.

But protests have also erupted over other issues, including calls for higher wages, lower taxes, better pensions and easier university entry requirements.

The movement's core aim, to highlight the economic frustration and political distrust of poorer working families, still has widespread support.

An opinion poll on Friday suggested a dip in support for the protests, but it still stood at 66%.

Meanwhile, President Macron's ratings have fallen to 23% amid the crisis, polls suggest.

Protest timeline

17 November: 282,000 protesters - one dead, 409 wounded - 73 in custody

24 November: 166,000 protesters - 84 wounded - 307 in custody

1 December: 136,000 protesters - 263 wounded - 630 in custody

8 December : 136,000 protesters - 118 wounded - 1,220 in custody--bbc

Interserve: Major government contractor seeks second rescue deal

One of the UK's largest providers of public services has confirmed that it is seeking a rescue deal as it struggles with £500m of debt.

Interserve, which works in prisons, schools, hospitals and on the roads, said it was "making good progress" on a long-term recovery plan.

It said details of the plan, which it expected to announce early next year, were yet to be finalised,

However, it was likely that it would involve issuing new shares.

Workers at the Foreign Office and the NHS are among Interserve's tens of thousands of UK employees.

The government has said it supports the company's long-term recovery plan.

On Saturday, the Financial Times reported that the company was looking for a deal to refinance its debt which would mean lenders taking a significant loss, while public shareholders would be "virtually wiped out".

Interserve's statement, issued on Sunday, said it was in talks about a "deleveraging plan", which it said would deliver "a strong balance sheet".

Lenders resigned to write-offs

Simon Jack, business editor

Sources close to Interserve's creditors have told the BBC they accept they may have to write off some of their loans to ensure the company's survival.

Lenders described talks around the company's future as "extremely fluid".

They recognised inevitable comparisons to the situation that engulfed Carillion, but insist the company's management still has lenders' support.

The BBC also understands Interserve is expected to announce imminently it has secured new public service contracts.

The Labour party leadership - ideologically opposed to the role of private companies in the provision of public services - has insisted that no new government contracts should be awarded to the company while it is in a parlous financial position.

That position is widely considered within industry to be detrimental to the future of a company that employs 75,000 worldwide, 45.000 in the UK.

Read more from Simon here

"Although the form of the deleveraging plan remains to be finalised, it is likely to involve the conversion of a substantial proportion of the group's external borrowings into new equity, an element of which may be sold to existing shareholders and potentially other investors," the firm said.

"If implemented in this form, the deleveraging plan could result in material dilution for current Interserve shareholders."

Interserve's share price dropped to a 30-year low last month.

Despite lucrative contracts in the Middle East and its wide range of work in the UK, the company has continued to lose money since March, when it agreed an earlier rescue deal.

Its troubles have been blamed on cancellations and delays in its construction contracts as well as struggling waste-to-energy projects in Derby and Glasgow.

Interserve claims its prospects are improving, and says it will increase profits this year.

What does Interserve do?

>From its origins in dredging and construction, the company has diversified into wide range of services, such as health care and catering, for clients in government and industry.

At King George Hospital in east London, for instance, Interserve has a £35 million contract for for cleaning, security, meals, waste management and maintenance.

Its infrastructure projects include improving the M5 Junction 6 near Bristol, refurbishing the Rotherham Interchange bus station in Yorkshire, and upgrading sewers and water pipes for Northumbrian Water.

But Interserve is also the largest provider of probation services in England and Wales, supervising about 40,000 "medium-low risk offenders" for the Ministry of Justice.

In a statement, Interserve said: "The fundamentals of the business are strong and the board is focused on ensuring Interserve has the right financial structure to support its future success."

The company said its options included bringing "new capital into the business and progressing the disposal of non-core businesses ".

Interserve's difficulties follow the collapse of Carillion in January 2018, which put thousands of jobs at risk and cost taxpayers £148m.

Interserve shares dive on fears for future

Government reassures over Interserve

Following that, the government launched a pilot of "living wills" for contractors, so that critical services can be taken over in the event of a crisis. Interserve is one of five suppliers taking part.

A Cabinet Office spokesperson said: "We monitor the financial health of all of our strategic suppliers, including Interserve, and have regular discussions with the company's management. The company successfully raised new debt facilities earlier this year, and we fully support them in their long term recovery plan."--bbc

O2 'to seek millions' in damages over data outage

Mobile operator O2 is understood to be seeking millions in damages from supplier Ericsson after last week's day-long data network collapse.

The total bill could be up to £100m, according to The Telegraph.

O2 smartphone users were unable to use their mobile phone data last Thursday. Ericsson blamed expired software certification for the problem.

Both firms have apologised for the issue and O2 has already set out how it plans to compensate customers.

Customers with a monthly subscription will be refunded the cost of two days' service by the end of January.

Pay As You Go customers will get 10% extra when they top up their phone in the new year or 10% off when they buy data for mobile broadband devices.

O2 compensation for customers over outage

O2 data network restored after outage

'We're reliant on data and phone networks'

O2 said voice calls were not affected by the problem, but some customers said they could not make calls or send texts either.

The mobile phone operator is owned by Spain's Telefonica and has the UK's second-largest mobile network after EE, which is part of BT. It is the company that bills customers, so it holds the responsibility for compensation.

O2 has 25 million users and also provides services for the Sky, Tesco, Giffgaff and Lycamobile networks, which have another seven million users.

Services such as bus timetable information were also affected by last week's outage, while many businesses also faced disruption.

Telefonica's UK chief executive Mark Evans told the BBC last week it planned a "full audit" of the problem.

"What we will now do is a full audit, a thorough audit, across both organisations to ensure whatever steps can be taken will be taken to provide the continuous service that our customers expect and deserve."

Ericsson said last week that "an initial root cause analysis" had indicated that the "main issue was an expired certificate in the software versions installed with these customers".

"The faulty software that has caused these issues is being decommissioned," Marielle Lindgren, chief executive of Ericsson UK & Ireland, said at the time.--bbc

Huawei arrest: China demands Canada free Meng Wanzhou

China has demanded that Canada release the arrested Huawei executive Meng Wanzhou or face consequences.

Vice Foreign Minister Le Yucheng separately summoned both the US and Canadian ambassadors and lodged a "strong protest" urging her release.

The ministry described Ms Meng's arrest as "extremely nasty".

Ms Meng, Huawei's chief financial officer and daughter of the firm's founder, is accused of breaking US sanctions on Iran.

She was held in Vancouver last Saturday and faces extradition to the US, where she could be jailed for up to 30 years if found guilty.

China insists that she has not violated any laws.

What's going on with Huawei?

A quick guide to the US-China trade war

On Friday Ms Meng appeared before a Canadian court, which adjourned a decision on whether or not to allow bail until Monday.

What has China said?

Ms Meng's arrest while she was changing planes in Vancouver last Saturday was a serious breach of her rights, Reuters quoted the foreign ministry as saying.

It "ignored the law" and was "unreasonable", it said.

"China strongly urges the Canadian side to immediately release the detained person... otherwise Canada must accept full responsibility for the serious consequences caused," the statement added.

On Sunday, Le Yucheng made similar demands to the US, warning: "China will respond further depending on US actions."

What happened during Friday's court appearance?

The Supreme Court of British Columbia was told that Ms Meng had used a Huawei subsidiary called Skycom to evade sanctions on Iran between 2009 and 2014.

The court was told that she had publicly misrepresented Skycom as being a separate company.

It heard a Canadian prosecutor say that Ms Meng was accused of "conspiracy to defraud multiple financial institutions".

The prosecutor said she had denied to US bankers any direct connections between Huawei and SkyCom, when in fact "SkyCom is Huawei".

Ms Meng could be a flight risk and thus should be denied bail, he added.

Why was the arrest significant?

The arrest has put further strain on US-China relations. The two countries have been locked in trade disputes, although a 90-day truce had been agreed on Saturday - before news of the arrest came to light on Wednesday.

Huawei is one of the largest telecommunications equipment and services providers in the world, recently passing Apple to become the second-biggest smartphone maker after Samsung.

Canadian Foreign Minister Chrystia Freeland said on Friday that China had been assured that due process was being followed and Ms Meng would have consular access while her case was before the courts.

Ms Freeland reiterated Prime Minister Justin Trudeau's claim that Ms Meng's arrest had "no political involvement".

Meng Wanzhou, 46, joined Huawei as early as 1993, when she began a career at her father's company as a receptionist.

After she graduated with a master's degree in accountancy from the Huazhong University of Science and Technology in 1999, she joined the finance department of Huawei.

She became the company's chief finance officer in 2011 and was promoted to vice-chair a few months before her arrest.

Ms Meng's links to her father, Ren Zhengfei, were not known to the public until a few years ago.

In a practice highly unusual in Chinese tradition, she adopted her family name not from her father but her mother, Meng Jun, who was Mr Ren's first wife.

Does Huawei concern the West?

Some Western governments fear Beijing will gain access to fifth-generation (5G) mobile and other communications networks through Huawei and expand its spying ability, although the firm insists there is no government control.

Japan is expected to ban government use of products made by Huawei and ZTE over cybersecurity concerns, local media reported on Friday. It would follow moves by New Zealand and Australia to block Huawei.

Should we worry about Huawei?

Why has the UK not blocked Huawei?

US National Security Adviser John Bolton said his country has had "enormous concerns for years" about the practice of Chinese firms "to use stolen American intellectual property, to engage in forced technology transfers, and to be used as arms of the Chinese government's objectives in terms of information technology in particular".

"Not respecting this particular arrest, but Huawei is one company we've been concerned about," he said.

What are the Iran sanctions?

US President Donald Trump last month reinstated all the US sanctions on Iran that had been removed under a 2015 nuclear deal.

Trump re-imposes Iran sanctions: Now what?

Iran nuclear deal: Key details

Mr Trump had been fiercely opposed to the deal, which saw Iran limit its controversial nuclear activities in exchange for sanctions relief.

The re-imposed sanctions hit oil exports, shipping and banks - all core parts of Iran's economy.

Although there are some waivers, US Treasury Secretary Steven Mnuchin has said the US will "aggressively" target any firm or organisation "evading our sanctions".--bbc

Wall Street ends lower after a down week

US share indexes fell by more than 2% on Friday, as uncertainty continued to roil financial markets.

The declines extended losses from earlier in the week and hit nearly every sector, led by technology firms.

The Dow Jones index and S&P 500 both tumbled about 2.3%, while the Nasdaq fell more than 3%.

The falls came as charges were outlined against a top Huawei executive, while a weaker-than-expected jobs report renewed concerns about economic growth.

US markets had performed better than expected in 2018, hitting record highs earlier in the year.

But investors expect growth in the US and globally to slow in 2019, a deceleration worsened by new trade tariffs and rising interest rates.

The cluster of concerns has cast markets into turmoil.

On Friday, the slowdown in jobs monthly growth raised questions about the path for interest rates, while the hearing for Huawei's chief financial officer further fanned worries about US-China trade tensions.

Friday's falls left all three indexes down more than 4% for the week.

The Dow and the S&P finished lower than they were at the start of 2018, while the Nasdaq was roughly flat.

Intel and Micron, which both do business with Huawei, were some of the the biggest losers, falling 4.4% and nearly 6.3% respectively.

Earlier, moves on Asian markets were more muted, while European shares mostly recovered after sharp declines on Thursday. In London, the FTSE 100 closed up 1.1%.

While some analysts have argued the recent declines in US share prices are simply a needed correction from the earlier highs, researchers at Capital Economics said they expect to see this week's turbulence to continue.

"In particular, while both the S&P 500 and US Treasury yields have started to drop a little sooner than we had previously anticipated, we still suspect that both have much further to fall in 2019," they said.--bbc

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

Cassava 

shares list on the ZSE

11/12/2018

Unity Day

22/12/2018

Christmas Day

25/12/2018

Boxing Day

26/12/2018

New Years’ Day

01/01/2019

 <mailto:info at bulls.co.zw> 

DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of Faith Capital (Pvt) Ltd for general information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities. The information contained in this report has been compiled from sources believed to be reliable, but no representation or warranty is made or guarantee given as to its accuracy or completeness. All opinions expressed and recommendations made are subject to change without notice. Securities or financial instruments mentioned herein may not be suitable for all investors. Securities of emerging and mid-size growth companies typically involve a higher degree of risk and more volatility than the securities of more established companies. Neither Faith Capital nor any other member of Bulls ‘n Bears nor any other person, accepts any liability whatsoever for any loss howsoever arising from any use of this report or its contents or otherwise arising in connection therewith. Recipients of this report shall be solely responsible for making their own independent investigation into the business, financial condition and future prospects of any companies referred to in this report. Other  Indices quoted herein are for guideline purposes only and sourced from third parties.

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